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Old 2014-07-25, 10:39 AM
buildmyhome buildmyhome is offline
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Default Lot premium

Anybody has experience with resale of houses with a lot premium? If I pay $40K for a pie-shaped lot as a premium, will I get the money when I sell the house?
For example I have a premium lot and my neighbor has a non premium lot. If we both put our houses for sale at around the same time, will I be able to demand $40k more, considering everything else is the same?

Please help me as I am very confused about the kind of lot I should go for!

thanks!!!
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Old 2014-07-25, 10:44 AM
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Ghostridercdn Ghostridercdn is offline
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Quote:
Originally Posted by buildmyhome View Post
Anybody has experience with resale of houses with a lot premium? If I pay $40K for a pie-shaped lot as a premium, will I get the money when I sell the house?
For example I have a premium lot and my neighbor has a non premium lot. If we both put our houses for sale at around the same time, will I be able to demand $40k more, considering everything else is the same?

Please help me as I am very confused about the kind of lot I should go for!

thanks!!!
Resale value will depend on market conditions at the time of listing.

My last home was on a "premium lot” I did get more than others on my street.


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Old 2014-07-25, 10:51 AM
bluejay bluejay is offline
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As a buyer, I would pay more for a premium lot, but hard to say exactly how much more. I would consider alot of factors when buying a house (finishes, how well the property was maintained etc), and location would be one of those factors.

For example, I would pay more not to front or back onto a busy road. However, I probably wouldn't pay more for a pool size lot as I am not interested in putting in a pool, nor do I value a huge lot. (On the other hand, a friend of mine specifically looked for pool size lots because they wanted to put in a pool). I don't particularly like walk-outs so I probably wouldn't pay extra for that either.

I paid more for a lot that backs on to greenspace, but I don't necessarily expect to get that back when selling, (though I don't expect to sell for a long time). It was worth it to me as I enjoy that view every day, I didn't pick it with resale in mind. That said, if my house and my neighbor's across the road were up for sale at the same time, I expect mine would be more desirable because of the view, though that doesn't mean mine would sell for more, maybe faster.

Last edited by bluejay; 2014-07-25 at 10:55 AM.
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Old 2014-07-25, 11:13 AM
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gerapau gerapau is offline
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It really does depnd on market conditions when you sell but odds are that if you were willing to pay more when you bought then there will probably be someone willing to pay more when you sell.
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Old 2014-07-25, 11:22 AM
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xdarrylx xdarrylx is offline
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My $.02

A "premium lot" such as a corner, while usually larger and no side neighbour, does mean it's more land to maintain and often times people aren't as keen to have a side yard and while you may have paid more to buy this land from the builder for the aforementioned perks, I personally wouldn't want to pay more as I don't consider the side yard enough of an incentive to justify the inflated cost.

However if you have a 40' deeper lot for example, or back onto greenspace, these are often reasons to pay a premium that often can be recouped when selling.
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Old 2014-07-25, 11:29 AM
Almost_Home Almost_Home is offline
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I definitely wouldn't pay 40K more for the exact same house with a larger lot. I can see asking abit higher (maybe 10-15Kish, depending on how much bigger it actually was) but definitely not 40K more. JMO.
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Old 2014-07-25, 11:51 AM
Scott Scott is offline
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In most cases, you aren't going to re-coup 100% of what you paid for the premium.

A useful tip is to negotiate with the builder regarding the land premium. If they are asking 40k, make an offer for 30k, or even 20k. Often times, builders will reduce the land premium over time if there are no interested buyers. You don't want to pay full price when the builder was going to discount it next week if nobody bought it. I'm not saying the builder is willing to negotiate, but its worth a try and you might save some money. Doesn't hurt to make an offer.

Last edited by Scott; 2014-07-25 at 11:57 AM.
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Old 2014-07-25, 11:55 AM
BlkStnBerk2 BlkStnBerk2 is offline
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According to a few real estate friends, the ONLY homes which would most likely recoup the lot premium costs, would be those with deeper lots backing onto green space, AND rural acreage lots.

Otherwise, the builder bends you over for a premium you will not recoup, UNLESS someone is very desperate to have your home, and will pay your asking price.

You can ask whatever you want for your home, but it's value is only what someone will pay for it.
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Old 2014-07-25, 02:19 PM
BrandonH BrandonH is offline
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Get a premium lot if the extra it comes with is something that you will use, need or want. Otherwise, don't get it just for the sake of resale.
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Old 2014-07-25, 03:02 PM
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I do agree with Almost Home, I wouldn't pay more than $15K for premium lot (if both houses condition are the same).
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